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Pay Now, Save Later on the F-35?

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By Michael Rainey

March 12, 2018

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Lockheed Martin, the lead contractor on the F-35 Joint Strike Fighter program, wants the Pentagon to sign longer contracts for more planes as part of an effort to reduce the per-unit price of the world’s most expensive weapons system. The idea is to move toward full production more quickly, so the program can start benefit from economies of scale sooner, according to a report in The Wall Street Journal. Lockheed Martin is expected to present its proposal to the Defense Department later this month.

The price of the F-35 continues to be a sticking point as the Pentagon and Lockheed Martin negotiate the contract for the next batch of fighter jets. The price has fallen steadily as the production process has slowly ramped up, from more than $250 million per aircraft in the first order in 2007 to roughly $95 million in the most recent order in 2016. (The prices are for the F-35A, the Air Force version that will be built in the largest numbers. The Navy and Marine versions of the plane cost millions more, though their prices are expected to drop, too.) The goal is to achieve a per-unit price of $80 million, but it’s still not clear when that milestone will be achieved.

Critics worry, though, that it could be a big mistake to agree on a contract covering hundreds of aircraft when the program itself is still experiencing significant technical problems, ranging from buggy software to flaws in launching missiles and firing its onboard cannon, which will require billions more to identify and fix. (Just last week, the Pentagon announced that it will cost an estimated $16 billion to modernize the existing fleet of 270 F-35s.) And even if the per-unit price does come down faster, it probably won’t put much of a dent in the program’s estimated $1.5 trillion lifetime cost.